Judaism and economics
Was Joseph the world’s first economist?
While perhaps not widely recognised outside of academic and rabbinical circles, the interface between economics and Jewish tradition, in both its halachic (legal) and aggadic (ethical) aspects, has long been a focus of intellectual curiosity.
The contemporary focus on this interface is illustrated, for example, by Aaron Levine’s Economic Public Policy and Jewish Law published almost three decades ago and the 700-page(!) Oxford Handbook of Judaism and Economics published in 2010. Further, Rabbi Lord Jonathan Sacks devoted his Covenant and Conversation commentary on parashat Miketz to this topic in 2017.
Rabbi Sacks makes an elegant case for considering Joseph as perhaps the world’s first economist. Parashat Miketz begins with the dreams of Pharaoh. Pharaoh sees thin cows consuming fat ones but nevertheless remaining thin. His advisers are unable to offer a satisfactory interpretation.
Through the intercession of the butler whose dreams Joseph had successfully interpreted while they were imprisoned together, Joseph is brought to Pharaoh. Joseph interprets Pharaoh’s dream as a message about Egypt’s economic future: There will be seven years of bountiful crops and seven years of famine. In so doing, Joseph effectively develops a theory of economic cycles. That economies will have their cyclical ups and downs is now taken as a given by both governments and economists. But unlike the special challenges of a very severe famine-induced economic downturn, the ongoing challenge for public policy in Western economies is how to moderate these cycles so that economies neither overheat nor cool down excessively.
Joseph advises Pharaoh to set up large grain stores during the years of bounteous crops – something akin to what we now refer to as a sovereign wealth fund. (An Australian example of a sovereign wealth fund is the Future Fund which is designed to meet the future superannuation liabilities for former and current Commonwealth public servants.)
In consequence of his dream interpretation and economic advice, Joseph is appointed vizier (the highest official in ancient Egypt) by Pharaoh who also names him Tzaphenath Paneah.
As vizier, Joseph sets about building Egypt’s sovereign wealth fund. Thus Bereshit 41:49 states: “Joseph piled up grain like the sand of the sea, in exceeding measure, until they ceased to count [it}, for it was without number.”
There is another aspect of Joseph’s economic policy that, in my select reading of a range of parasha commentaries, appears only to have been noted by the eminent 19th century rabbi, Rabbi Samson Rafael Hirsch.
Once the famine took hold, Joseph opened all of the storehouses and began selling their contents to the Egyptians. And yet, in verses 56 and 57 of chapter 41, the word “lishbor” rather than “limkor” (to sell) is used in referring to the sales of grain.
Rabbi Hirsch notes that the fundamental meaning of the word “lishbor” is to break up or split up. He interprets this usage to mean “to retail, that is, to buy or sell in small quantities.” Thus, he translates key phrases in verse 56 as “and sold [by Joseph] at retail” and verse 57 as “to buy [by the Egyptians] at retail”.
While some may be tempted to describe Joseph as an “unorthodox” Jew for opting to be in the retail rather than wholesale business, he understood that during a period of severe and lengthy famine he could only sell quantities of food to meet the immediate requirements of each family.
Only in this way could speculatively buying and black marketeering be prevented. Everybody wanting to buy grain and other food had to come in person to Joseph. He attended to the sales personally and did not depend on subordinates. Jacob understood that in Egypt grain was sold only at retail prices to individual householders. That is why he sent 10 of Joseph’s brothers from famine-
afflicted Canaan down to Egypt (Jacob kept Benjamin, his youngest son, at home) to buy grain rather than sending just one son, as the family representative, to do the buying. Doing so brought about everything else that followed.
So, the enduring message of this week’s parasha is:
- Sometimes, even from a family member, you have to buy retail and, second and more importantly,
- Even though most people may prefer to buy wholesale where possible, retail has its place and, in fact, can have major long-term implications beyond merely preventing speculative buying during a time of severe shortages. Joseph’s 10 brothers, referred to in parashat Miketz for the first time as Bnei Yisrael, set off for Egypt unaware of the consequences of their journey for future generations.
“Josephian economics” would ultimately result in Jacob leaving Canaan and also going down to Egypt, the enslavement of his descendants, Yetziat Mitzrayim (the Exodus from Egypt), receiving the Torah on Mount Sinai and, after 40 years of wandering in the desert under Moses’ leadership, being led across the Jordan River to conquer the Land of Israel under the leadership of Joshua.
Clearly, the economics of Joseph, the first economist, had enormous immediate and long-term impacts.
Allan Borowski is Emeritus Professor of Social Work and Social Policy, La Trobe University and an adjunct professor, the Chinese University of Hong Kong and Ariel University, Israel.
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